New Report: Individual Teacher Incentives, Student Achievement and Grade Inflation

Posted by on September 28, 2009

Teacher-performance incentives and student outcomes in Portugal

A recent paper from the Institute for the Study of Labor (IZA) in Bonn, Germany examines individual, performance-related teacher pay in Portugal’s public schools, introduced seven years ago. The study matched student-school data for secondary school national exams, then analyzed the same for two control groups: public schools in autonomous regions exposed to lighter versions of the reform; and private schools subject to the same national exams but whose teachers were unaffected by the reform. In what the researchers found to be scant literature on the topic, their study is the first to look at a reform applied across an entire country (rather than a localized pilot study), and to conduct an analysis with representative population data. Up to this point, research on incentive pay has faced severe data constraints and therefore tended to be based on case studies of individual organizations, making the results harder to extrapolate for larger populations. Looking at a reform in its entirety, the IZA research consistently indicates that an increased focus on individual teacher performance caused a significant decline in student achievement in Portugal, particularly with respect to scores on national exams; the study also documents a significant increase in grade inflation.
See the report: http://ftp.iza.org/dp4051.pdf